Half of Rescued Borrowers Default Anyway

[Soultrader 12]

Article here: http://money.cnn.com/2008/12/08/news/economy/mortgage_summit/index.htm?postversion=2008120818

[DbPhoenix 42]

I don't know how many people outside the US are interested in this subject, but I seriously doubt that any "modification" program is going to enjoy much success unless and until it addresses the question of the principle. Regardless of the interest rate, the loan payment, the term, etc., most people who are paying off a loan which represents a value which is twice, for example, what the house is worth are going to feel like chumps.

 

Banks make a multiple of the value of the loan anyway due to the interest payments, so it isn't as though they'd be giving the house away by adjust the principle. After all, they have to adjust the principle anyway if they have to sell the house in foreclosure, so why not adjust it anyway and keep the owners in their homes?

 

But Barack doesn't call, he doesn't write.....